Cold, wet weather and continued cost of living pressures put a dampener on British retail sales last month, with fewer purchases in clothing and DIY stores.
Total retail sales fell by 0.2 per cent in June, compared with growth of 4.9 per cent in June 2023, according to the latest retail sales monitor published by the British Retail Consortium and KPMG. Like-for-like sales declined by 0.5 per cent.
“Retail sales performed poorly in June as the cooler weather during the first half of the month dulled consumer spending,” Helen Dickinson, chief executive of the consortium, said. “Sales of weather-sensitive categories such as clothing and footwear, as well as DIY and gardening, were hit particularly hard, especially compared with the surge in spending during last June’s heatwave.”
Non-food sales in the three months to June fell by 2.9 per cent year-on-year, compared with growth of 0.3 per cent in the same period in 2023.
Televisions, laptops and computers were the few retail bright spots as Britons sought to upgrade in time for the Euro 2024 football tournament.
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Linda Ellett, UK head of consumer, retail and leisure at KPMG, the professional services group, also noted a rise in homewares, cooking accessories and furniture as people saved money by swapping dining out for meals in. However, she said that food and drink sales had been “disappointing” in June as consumers dealt with higher living costs.
Food sales rose by 1.1 per cent year-on-year in the second three months to the year, against growth of 9.8 per cent in the same period 12 months earlier.
Supermarket spending fell by 2.6 per cent in June, the first decline in two years, according to separate data from Barclays. It found that 65 per cent of Britons had cut back on their weekly grocery expenditure. More than half of these budget-conscious shoppers said they had been looking out for loyalty scheme discounts and supermarket deals.
Food prices inflation fell last month to 1.7 per cent, its lowest level since October 2021.
It was a tougher month for restaurants, where sales declined by 11.5 per cent year-on-year, although that was an improvement on the previous month’s 15.7 per cent annualised drop. More than half, or 52 per cent, of those cutting back on non-essential spending were choosing to spend less on eating out.
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Pubs, bars and clubs reported modest year-on-year growth in June, with business up by 0.5 per cent. The influx of sports fans watching the European football championship outweighed the bad weather and kept the category on a par with its strong performance in June last year.
June was a positive month for “at-home experiences”, which rose by 5.3 per cent overall, helped by takeaways and fast-food returning to growth after declining in May.
Overall consumer card spending fell by 0.6 per cent year-on-year in June, Barclays found, the first decline since February 2021.
Karen Johnson, head of retail at Barclays, said: “Once again, our data demonstrates the undeniable impact that unseasonable weather can have on consumer spending. However, the dreariness didn’t dampen spending across the board, with takeaways, digital content and entertainment all benefiting from people sheltering at home. Hopefully we’ll see sustained interest in the Euros and sunnier weather driving people to their local in July.”
